Overview of Cryptocurrency Types: How to Choose Mainstream Coins and How Beginners Should Invest?

In an era of increasing volatility in financial assets, more and more investors are turning their attention to the virtual currency market. Virtual currencies not only feature high liquidity and convenient trading characteristics but have also become an indispensable part of asset allocation. However, with thousands of virtual currencies flooding the market, how to identify worthwhile targets among numerous options becomes a key issue. This article will delve into the characteristics of the top ten cryptocurrencies by market capitalization, reveal high-quality projects validated through bull and bear cycles, and share systematic investment ideas and trading strategies.

Grasp the Market Rhythm: The Core Principles of Virtual Currency Selection

There is a classic saying circulating in the crypto community: “Pursue high returns in a bull market, seek stability in a bear market.” The logic behind this is not complicated—during a bull market, small-cap coins experience dramatic price swings, often leading to multiples of gains; in a bear market, it’s safer to hold large-cap coins with solid fundamentals, as they tend to be more resilient and have lower zeroing risks.

Therefore, the first step in choosing virtual currencies is to judge the current market trend. Based on this, investors should also consider multiple dimensions such as popularity, trading volume, liquidity, volatility characteristics, and application prospects. This multi-faceted perspective helps investors avoid the trap of blindly following the herd.

Market Cap Tier Analysis: Understanding the Differentiation of Cryptocurrencies

According to market capitalization, cryptocurrencies can be divided into two main camps: mainstream coins and altcoins. Usually, the top ten projects by market cap are defined as mainstream coins, while the rest are altcoins. Additionally, there are stablecoins pegged 1:1 to the US dollar and more volatile non-stablecoins.

Stablecoins (such as USDT, USDC) are relatively safe but have extremely small price fluctuations (usually less than 1%), making it difficult to generate significant returns. They are mainly used as cash reserves and trading media. Non-stablecoins, due to their obvious price volatility, are the primary tools for generating investment returns.

In a bear market, capital often flows from high-risk altcoins to mainstream coins. This also explains why mainstream coins are more suitable for long-term holding strategies of over 4 years—a cycle that covers the full bull and bear cycles, enough to smooth out short-term fluctuations and psychological stress.

Current Cryptocurrency Ecosystem Overview (Market Cap Rankings Reference)

The following list shows the market cap status and basic attributes of key projects:

Important Note: The above rankings are not fixed. Projects that once entered the top ten, such as Filecoin, Luna, etc., have been displaced due to market narrative changes. This highlights the market’s dynamic nature and multi-faceted risks.

Cryptocurrencies Worth Long-term Attention

Bitcoin(BTC): The Unshakable Digital Gold

As the pioneer of crypto assets, BTC has an irreplaceable first-mover advantage. Its total supply is fixed at only 21 million coins, with a deflationary mechanism halving every four years, increasing its scarcity over time. The latest inflation rate has fallen below 0.80%, far below traditional fiat currencies. Coupled with the launch of spot funds, institutional capital continues to flow in, further consolidating its position as the “King of Digital Assets.”

Core Advantages: Absolute scarcity, anti-inflation properties, highest market consensus

Ethereum(ETH): The Engine of Application Ecosystem Prosperity

Although Ethereum’s market cap is far below Bitcoin’s, its smart contract functionality attracts a global developer community. The total value locked (TVL) in Ethereum reaches $93.1 billion, ranking first among public chains. Trading volumes often reach 60-70% of Bitcoin’s, indicating high liquidity and active application. The launch of spot funds and staking features further strengthen its institutional asset attributes.

Core Advantages: Rich application scenarios, mature development ecosystem, comprehensive infrastructure

( Bittensor)TAO###: The Frontier of AI and Blockchain Integration

With rapid advancements in artificial intelligence, how to organically combine AI and blockchain has become a focus of the industry. TAO, as the governance token of the Bittensor network, aims to build a decentralized machine learning service marketplace. Its economic model references Bitcoin’s design, with a total cap of 21 million coins and a deflationary mechanism. The current price is $210.30.

Core Advantages: Riding the AI wave, Bitcoin-like token design, clear application scenarios

( XRP)XRP###: A Payment Tool with High Institutional Recognition

Ripple’s partnerships with global governments and financial institutions give XRP a unique endorsement value. Its transaction processing capacity far exceeds Bitcoin (theoretically 1,500-3,400 TPS vs. 7 TPS for BTC), and in actual operation, it can maintain 500-700 TPS, making it an ideal choice for inter-institutional clearing and settlement. The current price is $1.87, with a market cap of about $113.33B.

Core Advantages: High institutional acceptance, efficient processing, compliant outlook

( Solana)SOL###: The Optimal Balance of Performance and Cost

SOL is often called a “performance monster” due to its ultra-high throughput and extremely low fees. Using parallel processing technology, its theoretical throughput reaches 65,000 TPS, and in actual operation, it maintains 3,000-4,000 TPS, far surpassing Ethereum’s 15-30 TPS. The average transaction fee is only $0.00025, offering excellent cost-performance. The current price is $121.95, with a circulating market cap of $68.60B.

Core Advantages: Leading transaction speed, lowest fees, excellent development experience

( Other Projects Worth Attention

Chainlink)LINK### connects blockchain with real-world data. Its oracle network provides trustworthy off-chain data for smart contracts, serving as a critical infrastructure. Unlike “air coins,” LINK has tangible usage needs within the network. The current price is $12.18.

The Open Network(TON) and Dogecoin(DOGE) each have their own reasons for popularity: TON is backed by the Telegram ecosystem, while DOGE remains hot due to Musk’s ongoing attention. The prices of such projects often fluctuate dramatically with the movements of key influencers.

Investment Strategies: Long-term vs. Short-term

( Long-term Holding Is More Suitable for Most Investors

For beginners, short-term trading, especially intraday, involves many professional elements—systematic trading strategies, precise position management, and stable psychology. Long-term investing has a much lower threshold, requiring only basic buying and selling skills and an understanding of market cap concepts.

In theory, precise short-term trading can yield higher returns. But in reality, most people tend to lose big by chasing highs and selling lows, ending up with losses. Long-term holding avoids these pitfalls—it naturally aligns with market growth cycles and can effectively lock in trend-based gains.

For example, in 2018, the author bought BTC near $5,000, sold at $7,000 when it broke through, and later BTC continued rising to $12,000. The regret at that time was later offset by the subsequent low of $3,120. This case illustrates the importance of timely stop-loss and demonstrates that long-term holding can avoid the regrets of short-term operations.

) Asset Security Is a Prerequisite

Persisting through a bear market to a bull market is hard enough; if assets are stolen, all efforts are lost, and the losses can be devastating. Protecting exchange accounts, securely storing wallet private keys or seed phrases, and avoiding phishing DApps are essential basic safeguards.

Overcoming the “Cheap Coins Must Rise” Misconception

The most common fatal mistake for beginners is being tempted by false hopes of low-priced coins. Coins with many zeros after the decimal point can create illusions like “as long as it rises to a dime, I’ll get rich.” The reality is often cruel—these projects either go to zero or are on the way there. Even more dangerous, investors often exchange high market cap coins for a bunch of junk coins, ending up empty-handed on both ends.

Practical Guide: How to Start Investing in Crypto

Standard Trading Process

The most common method is to register an account on a reputable exchange, complete identity verification, and link payment methods. Usually, you buy stablecoins###USDT or USDC### via C2C in the fiat-to-crypto section, then transfer to the spot trading area to exchange for target coins. BTC and ETH, due to high liquidity, can be directly purchased via C2C.

( Trading Tools Selection

Platforms mainly offer spot trading; advanced investors can also use derivatives like futures, leveraged tokens, and staking. Beginners should start with spot trading, gradually gaining experience before considering derivatives.

) OTC Trading Risks and Opportunities

Besides centralized platforms, OTC trading is also an option. The simplest way is to buy from acquaintances, but it’s crucial to ensure the counterparty is reliable, preferably with face-to-face settlement to mitigate risks.

Three Major Cultivations of Investment Mindset

Overcoming Anxiety of Watching the Market

Long-term holding seems simple but is hard to execute. Rising prices trigger the desire to sell, while falling prices provoke stop-loss impulses. Clear trading goals are necessary, and even adopting both long and short strategies with separate funds can help. Further, transferring assets to wallets and physically isolating them can fundamentally eliminate the temptation to “touch” the assets.

Flexibly Responding to Market Changes

The top ten coins are suitable for both long-term holding and short-term participation. The key is to choose strategies based on market conditions. Bear markets favor long-term allocation, while bull markets offer opportunities for short-term trading.

Avoid Common Pitfalls

Unclear investment goals, lack of stop-loss setup, overpursuit of altcoins—these common mistakes often lead to continuous losses. Investors should establish their own risk management systems and avoid repeating others’ lessons.

Your Suitable Crypto Portfolio Plan

Conservative investors can focus on BTC and ETH, whose stability and consensus are sufficient for long-term holding.

Growth-oriented investors with some trading experience can consider diversifying into mainstream coins like DOGE, ADA, SOL, besides BTC and ETH.

Aggressive investors may explore high-volatility MEME coins, but must monitor the market continuously. These carry high risks and are not recommended as core holdings.

Regardless of your choice, remember: the crypto market is ever-changing, and market cap rankings are dynamic. Successful investors are those who adapt strategies flexibly based on their goals, risk tolerance, and market environment. Avoid blindly following the herd—build your own judgment system, which is the foundation for long-term stable growth.